There is abundant advice about how much to save, much of which urges individuals to aim to replace 80 percent of their preretirement pretax income. However, those who wait to save for retirement and follow this rule of thumb would save far too much of their gross income, and many would see their annual resources spike upward when they retire. The constant savings rate required to equalize consumption across the preretirement and postretirement years generally is generally much lower than the 80 percent rule.
Usage and reprints: Most publications may be downloaded free of charge from the web site and may be used and copies made for research, academic, policy or other non-commercial purposes. Proper attribution is required. Posting UI research papers on other websites is permitted subject to prior approval from the Urban Institute—contact firstname.lastname@example.org.
If you are unable to access or print the PDF document please contact us or call the Publications Office at (202) 261-5687.
Disclaimer: The nonpartisan Urban Institute publishes studies, reports, and books on timely topics worthy of public consideration. The views expressed are those of the authors and should not be attributed to the Urban Institute, its trustees, or its funders. Copyright of the written materials contained within the Urban Institute website is owned or controlled by the Urban Institute.